Correlation Between INSUN Environmental and Kmw
Can any of the company-specific risk be diversified away by investing in both INSUN Environmental and Kmw at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining INSUN Environmental and Kmw into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INSUN Environmental New and Kmw Inc, you can compare the effects of market volatilities on INSUN Environmental and Kmw and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in INSUN Environmental with a short position of Kmw. Check out your portfolio center. Please also check ongoing floating volatility patterns of INSUN Environmental and Kmw.
Diversification Opportunities for INSUN Environmental and Kmw
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between INSUN and Kmw is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding INSUN Environmental New and Kmw Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kmw Inc and INSUN Environmental is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on INSUN Environmental New are associated (or correlated) with Kmw. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kmw Inc has no effect on the direction of INSUN Environmental i.e., INSUN Environmental and Kmw go up and down completely randomly.
Pair Corralation between INSUN Environmental and Kmw
Assuming the 90 days trading horizon INSUN Environmental New is expected to generate 0.45 times more return on investment than Kmw. However, INSUN Environmental New is 2.23 times less risky than Kmw. It trades about -0.04 of its potential returns per unit of risk. Kmw Inc is currently generating about -0.04 per unit of risk. If you would invest 873,000 in INSUN Environmental New on October 15, 2024 and sell it today you would lose (303,000) from holding INSUN Environmental New or give up 34.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
INSUN Environmental New vs. Kmw Inc
Performance |
| Timeline |
| INSUN Environmental New |
| Kmw Inc |
INSUN Environmental and Kmw Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INSUN Environmental and Kmw
The main advantage of trading using opposite INSUN Environmental and Kmw positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INSUN Environmental position performs unexpectedly, Kmw can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Kmw will offset losses from the drop in Kmw's long position.| INSUN Environmental vs. Korea Environment Technology | INSUN Environmental vs. Paradise Co | INSUN Environmental vs. Seoul Semiconductor Co | INSUN Environmental vs. JUSUNG ENGINEERING Co |
| Kmw vs. KMH Hitech Co | Kmw vs. GemVaxKAEL CoLtd | Kmw vs. Bosung Power Technology | Kmw vs. Busan Industrial Co |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |